MS going the Apple Way..as always

They have done it in the past, they will do it in the future , they are doing it as we speak.

Microsoft Corp,world leader in operating systems, has once again got something from Apple. Microsoft is looking to set up its own network of retail stores and they are pretty serious this time. David Porter who has spent 25 years at Wal-Mart !!!, the world's No 1 retailer has been hired as corporate vice president of retail stores for Microsoft.courtesy:GIZMODO.com

Mr. Porter, in a statement, said there are "tremendous opportunities" for Microsoft to create a "world-class shopping experience" for the company's customers.

"The purpose of opening these stores is to create deeper engagement with consumers and continue to learn firsthand about what they want and how they buy," Microsoft said in a statement.

I am not sure if MS stores will flourish as Apple stores did.It will have to face many issues like Channel conflicts,whether to add third party hardware (laptops etc to boost Windows OS sale), pricing etc .I think it will probably boost up the sales of Xbox product line and Gaming software rather than the MS Windows or Office product line.

I think timing is a key aspect,if MS sets up its first store by holiday season and release its Windows 7 which has got positive reviews, it may enjoy a smooth take off.

There are reports that MS stores will feature "PC Gurus" a direct copy of Apple's Genius concept.Personally I don't care if MS copies Apple all the time. As long it provides better value to its consumers,they wont care who did it first ,but rather who did it best? Why do you think Macintosh did not flourish as MS Windows even though it came first?

First Stock it ..then Sell it

Me and my brother were shopping in SPAR and there was Suguna Chicken stall promoting their ready to cook chicken range by offering fried chicken  for tasting . As bachelors, we thrive on ready to cook ,ready to eat foods.So obviously we were lured towards it [ plus free chicken 65 :)]

We tasted all three variants ,the chk-65 was so good,that we instantly added to our list. The chk manchurian was ok and the chk kofta...well its not worth eating even if its free . So we asked them for a pack of chk 65 and they directed us to the frozen foods section were they were stocked,atleast we thought so... Sadly the section was filled with the koftas and other boring stuffs but not the good  ones. When I told the counter guy, he looked surprised , and went to the section and checked personally.Then he checked with the another guy and said "Sorry sir, we are out of stock ,you can buy the kofta if you want".I said "I don't want that..but why are you selling what you don't have?  "                   When I crossed the section sometime later, only the kofta was on display with no people around .

Communication gap between the stocking staff and selling staff , has resulted in loss of sale for the chk company(I guess many would have been disappointed like me).                                                    A smart idea would have been to give out only the chk65 for tasting and sell a pack of all three variants at a special prize . I am sure many would have bought into it and later find the kofta is real awful. Atleast I would have ... :) 

Indian Retail yet to Arrive

Black Friday has officially kick started the holiday shopping season in the U.S.

ShopperTrak RCT, a retail industry research firm, said total Black Friday sales rose 3% this year, to about $10.6 billion nationwide,the smallest gain for a “Black Friday” in three years. But retailers say it could have been worse and they hope the positive trend will continue through the season. ShopperTrak has estimated that 9.9 percent fewer shoppers will descend on stores this holiday season, producing a sales gain of 0.1 percent

Compare this with Indian retail scenario

When a single Black Friday sales account for more than $450 billion ,Industry experts believe modern retail could be worth as much as $100 billion out of a total $600 billion Indian consumer market only by 2011.Kishore Biyani told CNN.com."Our sales during Diwali (the festival of lights in October) were quite good, up 18 percent year on year." 

But the 18% will be still very less when looked in actual sales figures. So when will India have its Black Friday?Big Bazaar CEO Rajan Malhotra told CNN.com, "I think it is up to modern retail to create occasions of consumption in a market like ours," noting that the chain's "Once in a Lifetime" promotion last month took sales to record levels.

Retail expert Ireena Vittal of consultancy McKinsey says 180 million of India's 205 million households are still intimidated by modern retail, ensuring that traditional retail formats will continue to grow.

I think Indian retail has still a long way to go before we have "Great Indian shopping Day" comparable to the US Black Friday.

Iphone-not so "happening" in India

When Apple set 100,000 as its sales target for the iphone in India for the period till Dec 2009,they thought they are being humble because of the fact that in India around 120 million handsets are sold every year of which 4 to 5% are smartphones.

But now they realise that it will be very hard to reach this modest target.Livemint.com reports that only 11000 iphones have been sold so far out of the 50,000 of the initial shipment.

So what went wrong? Is it the price? not really...because Nokia's iphone killers are doing well although they are priced same or even more(30k+range) than the iphone in India.Its too early to quote numbers of the N96 but sales is brisk according to sellers.

Two main P's that Apple got wrong are Promotion & Place-that is they did not communicate properly to the Indian consumer why they have to pay three times more than the US price.Also only the service providers  promoted and not Apple despite its retail presence. And Airtel and Vodafone thought since its The Iphone it will sell by itself and only a low level of promotion was done(only some printads ands billboards that iphone is available)    

Then Place i.e. distribution, when retail is growing in India,Iphones are sold only through the service provider outlets and not through other mainstream retailers.Meanwhile the availability of Nokia phones is much much greater in the Indian Marketplace.

If sales of iphones is to be pushed it should be done immediately by collaborating with other organised retailers  because the time is running out and before you know it consumers would have forgotten the iphone.

Watch Out .... Tesco Is Coming To Town

After 3 years of boadroom battles, they have finally found the passage to India through TATA's Trent.Yes, Tesco UK's largest retailer, is coming to town. Emulating Wal Mart's strategy Tesco is targeting the B2B market by setting up cash and carry outlets in major cities like Mumbai,Bangalore& Delhi.
Apart from this ,Tesco will also provide retail expertise to Trent to revamp its Star Bazaar outlets which is lagging behind its competitors. This will surely boost up Trent's position in the Indian retail scenario.

Walmart is planning for 15 outlets by 2015 while Tesco has plans for only 3 stores right now but both starting in 2009 .However Both the giants might not have a head on competition as their first stores will be opening n different locations.While Tesco will start at Mumbai,Wal Mart will start in Punjab.
The cash & carry stores from Tesco will be operated under its own name, while Bharti Wal Mart have yet to unveil its branding strategy.But it is speculated that stores might not have Wal Mart's logo due to the political heat it receieved after the initial announcements.
In spite of all these, Metro,the German wholesaler appears quite confident as it has the first mover advantage and also it has previously given a tough time to Wal Mart when Wal Mart had set up stores in Germany.

We have to wait and see how the local players like Future,Reliance etc will take on the global giants.Anyway the organised retail sector in India will improve from its current 5% and we can assume that it will do good to the consumer.

The Bold and The Brand conscious

The new showroom of Future Group's Brand Factory in HARA Mall opened up in a odd timing when malls in Bangalore were mobbed with bomb scares.Yet consumers flocked in huge numbers to visit the mall which offers discounted rates throughout the year.

Is it just because consumers are addicted to malls or they have become much more brand conscious?

I think it is the latter.I believe the average Indian consumer was always brand conscious but either he could not afford it or his favorite brands were not available.Now with raising disposable incomes and lots of international brands ,the Indian consumer is shopping happily.
Also once the consumer gets the feel of shopping in a large format store with lots of brands at discounted rates, it is very unlikely he will go to places like commercial street,where he has to haggle over prices and visit at least 5 stores to finish his shopping.
This also strengthens the fact that the Indian retail has a tremendous scope for growth.